If Wall Street's setback since January is indeed simply a routine correction in a still-vibrant bull market, the time is nearing for the market to prove it.
Last week's resilient finish was a step in that direction, though the longer the process drags on the higher the bulls' burden of proof.
The drop from the Jan. 26 peak in the S&P 500 measured nearly 12 percent at its deepest and has now lasted almost three-and-a-half months. Monday is the 60th day since the the Feb. 9 low point, which qualifies as a long stretch for a mild correction to go without retaking most of the lost ground.
Shortly after the initial tumble that quickly followed January's steep 7 percent surge, plenty of market observers pointed to a historical pattern showing that sharp drops from an all-time high tend to be recouped quickly. We're a bit beyond the point of "quickly" by now.
Leuthold Group's chief investment officer, Doug Ramsey, plotted the current path against other 7-percent to 12-percent declines in bull markets, which shows the sluggish, prolonged process still underway. "While old age alone may not kill a bull market, 'morbidity' climbs rapidly the longer a correction lingers," Ramsey says.
The market has also worked itself into a corner, so to speak. The S&P 500 is now coiled tightly between lines running down from the January summit and the uptrend from the worst levels touched three months ago.
"Now we are reaching a point where something is going to have to give," says Larry McMillan of the McMillan Analysis trading-advisory service.
This indecisive, stalled tape might be creating some suspense about whether something a bit more damaging is at work in this market retrenchment than a simple digestion of last year's gains and a reset of valuations. Yet there are reasons to believe this choppy, churning phase will ultimately be resolved with a resumption of the market's long-term climb.